When developing a list of pros and cons, one should always try to strike a balance. Spoiler alert – this will not be one of those balanced lists. All you need to do is Google the word “counteroffer”, or questions around the topic, and the overwhelming vibe you will get is that they simply do not work. Titles like “11 Reasons To Not Accept a Counteroffer” will flood the top of your feed. LinkedIn recently completed a survey in late 2021 that showed 80% of respondents regretted accepting a counteroffer within the first 90 days.
There are no guarantees in life outside of death and taxes, so I will still outline some of the rare instances where it can be effective. Heck, I will even start with the “Pros” to show I am an objective observer. 😉
This is by far one of the strongest motivating factors I see. Some crazy numbers have been thrown around the past 6-8 months. While that trend is definitely slowing, it has been primarily tied to the shallow talent pool. Employers know that good candidates are in short supply. It could take much longer to replace even a mediocre candidate. Throw in the fear of losing a really good employee, and some agencies have been aggressive in matching or exceeding offers that candidates receive. Money is not a problem solver most times, so it is rarely effective long term. But short term it can really cover up the reasons why a candidate may have been looking to leave in the first place.
Along with money, I have seen candidates receive perks of promotion – new title, new responsibilities, promises of a brighter future. All of the things that should have been available pre-resignation but have now magically appeared on the table to prevent the candidate from leaving. This can be an effective strategy if certain responsibilities are actually delegated to other people. If you move from client service to leadership, for instance, perhaps your time and talent can be better utilized for your long-term future. This could be one of those rare instances I mentioned that it could work out well.
Working remotely on a permanent basis
We have seen a lot of candidates get called back into the office, not like it, search for a job, and then their boss decides to let them work remotely once they find out they are trying to go somewhere else. This again can be a short-term fix to a long-term problem. If the employer is making an exception for the candidate looking to leave, it is going to create some internal strife. This can be effective if the overall strategy from an employer top down. Otherwise it is going to be seen as someone getting special favors or status simply because they attempted to resign or leave.
In the stock market you often hear the phrase “Historical performance does not promise future result.” Meaning that if a stock has been up 15% for five years in a row, it does not promise that will continue. Similarly, if everything you read and hear is that 80-90% of the time counteroffers do NOT work, then you better pay attention. I live in a world of probabilities and possibilities. While always “possible” you could buck the trend with your counteroffer, it is much more “probable” that you are going to fit into that high number of people that regret it. Really be sure to talk with someone you trust and compare/contrast the offer you received from another firm with the counteroffer to stay with your current firm.
If you turn down an offer (especially if it is already accepted) for a counteroffer, then your chances of keeping in touch with that employer are slim to none. While I don’t condone or encourage the practice, I have always thought it made more sense to accept a counteroffer if you never accepted the competing offer in the first place. When you have a good relationship with your boss, and let them know when things are getting close to an offer, or even at offer stage, and then the counter comes, I can understand that logic a little better. But once you have accepted an offer of employment from a new firm, you should be so convinced that is the right move that no amount of money or promises of promotion would make a difference.
I’m talking about the instant kind of regret. I recently had a candidate accept an offer with my client. A counteroffer followed. Which was accepted in lieu of my client’s offer. Within 24 hours there was a feeling of regret. Per my last point (see Burning Bridges), my client was disappointed and not willing to play ball to try and match anything. In fact, they rescinded their offer completely. They felt like there was a trust factor involved. If money could be a motivating factor once, it could be a motivating factor again.
You got the offer you were seeking to leave your current employer. The timing was right. The money was good. The team you were going to join was awesome. If the statistics are even close to being right, remember again that 80-90% of counters are not working after six months. So in your mind, please fast forward six months from the time you accepted the counteroffer that you now regret. The market is likely different. The roles available may not be as appealing. The money may not be as good. The culture fit that was so good before has now disappeared. The idea that there is an endless supply of good jobs out there is just not true. You might get lucky and find something else after six months of regretting your decision, but what does life look like if you’re not lucky? And I sure don’t like to count on luck when it comes to career decisions.
Before you resigned, and subsequently took a counteroffer to stay, your employer was probably not searching for your replacement. They are now on high alert and paying more attention to candidates that come across their desk. You now cost more than you did before, and the employer knows you were unhappy in some regard. The counteroffer could be a stall tactic to quietly be searching for your replacement.
Once you have received this counter, your employer may be looking at budgets more closely now. Your opportunities for additional raises and promotions may hit a ceiling for a longer-than-anticipated amount of time. You could be north of an acceptable range for the position you are in. As more and more people are hired, the landscape could change for what is a good number for your position. One of the main reasons outside of money that people look for a new job is career progression. If a clear outline of what that looks like when accepting a counteroffer is not presented, you are setting yourself up for disappointment.
To end on a possibly surprising note, part of me really does wish that counteroffers worked more often. Employers realize the error of their ways. Recognizing that they may have fallen short with providing an employee with all of the chances to succeed. Maybe making small tweaks or changes to work something out. Admitting fault in the process and working hard to change down the road. It simply isn’t the world we live in. Bosses will cover their own back sides to protect their own job. Employers will fail to see the bigger picture in what makes an employee happy. Money will be in play from all sides at all times. Emotions will run high and blame will be cast. When you focus on the facts and stay as objective as possible, the truth will reveal itself in such clarity that you should have seen it the entire time – counteroffers simply. don’t. work.